By Petchanet Pratruangkrai
The Nation
Other Asean countries have pressured Indonesia, Malaysia and the Philippines for a reduction in their tariffs on highly sensitive products, including rice and sugar, under the Asean Free Trade Agreement (Afta).
They fear that failure to do so will affect progress towards the goal of an Asean Economic Community.
The move came after the three countries' failure to fulfil Afta commitments for substantive reductions in tariffs, thus potentially prolonging the process of integration under a single market.
A senior Commerce Ministry source said yesterday that during the current Asean Economic Ministers Meeting, there had been a call from other member countries for Indonesia, Malaysia and the Philippines to fulfil the grouping's commitment to bring down import tariffs on rice and sugar.
"Other Asean members fear that the breaking of the commitment will create conflict among Asean countries. They would focus on seeking compensation in solving disputes between each other, if the three nations did not follow through on the commitment," said the source.
Under Afta, the three countries have kept rice and sugar on lists of highly sensitive products, maintaining high tariffs on those items.
Indonesia has only committed to cutting its tariff for rice to 25 per cent in 2015, and the tariff on sugar from 30-40 per cent to 5-10 per cent in the same year.
Malaysia has only committed to lowering its tariff for rice from 40 per cent to 20 per cent next year, while the Philippines has retained a high import duty of 40 per cent on rice import under the World Trade Organisation. The latter has also restricted its import quota to 350,000 tonnes a year.
Thailand, Singapore and Brunei, meanwhile, have committed to bringing down tariffs to between zero and 5 per cent for highly sensitive products next year, while Laos, Burma, Cambodia, and Vietnam will delay tariff reductions on seven highly sensitive products for a further five years.
According to a Commerce Ministry report, Thailand will suffer the most if Malaysia, Indonesia and the Philippines do not further reduce their import duties on rice and sugar. Sugar exports to Indonesia would be especially affected.
They fear that failure to do so will affect progress towards the goal of an Asean Economic Community.
The move came after the three countries' failure to fulfil Afta commitments for substantive reductions in tariffs, thus potentially prolonging the process of integration under a single market.
A senior Commerce Ministry source said yesterday that during the current Asean Economic Ministers Meeting, there had been a call from other member countries for Indonesia, Malaysia and the Philippines to fulfil the grouping's commitment to bring down import tariffs on rice and sugar.
"Other Asean members fear that the breaking of the commitment will create conflict among Asean countries. They would focus on seeking compensation in solving disputes between each other, if the three nations did not follow through on the commitment," said the source.
Under Afta, the three countries have kept rice and sugar on lists of highly sensitive products, maintaining high tariffs on those items.
Indonesia has only committed to cutting its tariff for rice to 25 per cent in 2015, and the tariff on sugar from 30-40 per cent to 5-10 per cent in the same year.
Malaysia has only committed to lowering its tariff for rice from 40 per cent to 20 per cent next year, while the Philippines has retained a high import duty of 40 per cent on rice import under the World Trade Organisation. The latter has also restricted its import quota to 350,000 tonnes a year.
Thailand, Singapore and Brunei, meanwhile, have committed to bringing down tariffs to between zero and 5 per cent for highly sensitive products next year, while Laos, Burma, Cambodia, and Vietnam will delay tariff reductions on seven highly sensitive products for a further five years.
According to a Commerce Ministry report, Thailand will suffer the most if Malaysia, Indonesia and the Philippines do not further reduce their import duties on rice and sugar. Sugar exports to Indonesia would be especially affected.
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